In Massachusetts, a social consumption establishment is a marijuana establishment permitted to sell marijuana or marijuana products and allow customers to consume marijuana or marijuana products only on its premises.
Agents of social consumption facilities are only permitted to sell marijuana or marijuana products to individuals in quantities sufficient for on-site use. Consumers are not allowed to buy more than 20 milligrams of delta-9-tetrahydrocannabinol each day. If the appropriate licenses and permissions have been obtained, a social consumption establishment may offer pre-packaged, shelf-stable, and non-edible food and drink products.
Note that marijuana social consumption businesses are not permitted to sell or permit the use of alcoholic or tobacco products on their premises. Individuals under the age of 21 are not allowed to enter the premises of a social consumption business.
According to the Adult Use of Marijuana Regulations (935 CMR 500.000), individuals or organizations wishing to open a marijuana consumption establishment in Massachusetts must acquire social consumption establishment licenses. For a period of 36 months from the date the first social consumption establishment receives a notice to commence operations, social consumption establishment licenses will be limited exclusively to businesses controlled by and with majority ownership comprised of Social Equity Program Participants and Economic Empowerment Priority Applicants.
Before beginning full operations, social consumption establishments seeking to enter the cannabis market as licensees must complete multiple stages. To become a licensee, the first step is to submit the application fee and all three parts of the application in one package. These are referred to as the Application of Intent (AOI), the Background Check, and the Management and Operations Profile.
Each section requires applicants to provide accurate information about the marijuana business, its employees, and any other entities associated with the business and demonstrate an understanding of the Cannabis Control Commission regulations applicable to the applicant's license type, licensure, and scale.
To apply for a social consumption establishment license, visit the Massachusetts Cannabis Industry Portal (MassCIP).
APPLICATION OF INTENT (AOI) SECTION
This section summarizes the necessary criteria and information and provides guidance on complying with the CCC's rules.
Required Individuals and Entities: The applicant must name persons or organizations with direct or indirect control over the social consumption establishment. One or more of the following conditions must be fulfilled by such persons:
Disclosure of In-State Interests: Applicants must disclose if any persons or organizations listed in the application have been disclosed in any previous Marijuana Establishment (ME) or Marijuana Treatment Center (MTC) license application or are associated with any other active license.
The disclosure should contain any current information that is known to be accurate and truthful. This content should not be deceptive, misleading, untrue, or fraudulent, nor should it include any information that may deceive or create a false impression.
Disclosure of Out-of-State Interests: Applicants must disclose if any individual or organization listed on their applications has had or currently has marijuana-related business interests in other states, as well as provide evidence of such interests. They should use their discretion in assessing if they have any other business interests relevant to their application.
This section may require the submission of a business license, articles of organization, bylaws, operating agreements, or an affidavit attesting to the disclosure's validity and sincerity.
Capital Resources: Applicants must disclose the amounts and sources of capital available to them from each individual or organization that contributes capital to the establishment's creation or operation. Capital may be in loans (financial, real, or personal property) or equity interests.
Along with the disclosure, the applicant must submit proof of the capital's existence, which may include, but is not limited to, a bank or financial institution record dated within 60 days of the date of application submission. Any written loan agreement must also be provided if a person or organization contributes money in return for loan repayment.
If the individual or entity supplying capital resources is also a direct or indirect control person or entity, they must be named in the appropriate section. After making these disclosures and submitting this information, the applicant must certify that the funds used to invest in or finance the establishment was lawfully earned or obtained, which may be shown via an affidavit or notarized document.
Bond or Escrow: All applicants must put aside a sum of money adequate to fund the dismantling and winding down of the marijuana social consumption establishment, either via a bond or an escrow account. The sum put aside must be sufficient to cover the expense of paying any outstanding state or local sales tax obligations, the cost of securing the licensee's premises, and the cost of destroying the licensee's inventory of marijuana and marijuana products.
Property Identification and Interest Documentation: Each applicant must specify the intended location of their marijuana business. Following the identification of the proposed location(s) for operations, the applicant must provide proof of property interest, which may include one or more of the following:
Host Community Agreement Certification: A one-page certification signed by the contracting authority of the host community and the applicant attesting to the completion of a Host Community Agreement is required. To operate several sites, each must have its own certification form that satisfies the above requirements. The Commission's website contains additional information on the laws governing Host Community Agreements.
Community Outreach Meeting Attestation and Documentation: The Community Outreach Meeting aims to inform and educate the local community about the planned establishment. The Community Outreach Meeting is highly recommended since it will help design inform the Host Community Agreement. Each applicant must have a Community Outreach Meeting that satisfies the Cannabis Control Commission's requirements.
Plan to Remain Compliant with Local Ordinances: Each applicant must describe the plans to guarantee that the social consumption establishment complies with all local rules, ordinances, and bylaws, including but not limited to those regulating the sale of adult-use marijuana or medical marijuana. Applicants must also provide the following information in their proposal:
Plan to Positively Impact Disproportionately Harmed People: An applicant must submit this Plan which is required to be designed to positively impact the following groups of disproportionately harmed people as identified by the CCC:
BACKGROUND CHECK SECTION
The applicant must include all relevant persons and organizations and any background disclosures and permission documents in this section. Each person or organization mentioned in the AOI section must also be included in the Background Check section. Individuals and organizations will be subjected to a thorough background check, and individuals will be fingerprinted.
Background Check Information: The Commission is obliged to decide on the suitability of each person and organization mentioned on an application for licensing, which is based in part on the results of background checks. Background checks will include the following, but will not be limited to:
Each person and organization named on the application must disclose actions in Massachusetts or another state. Applicants are not obliged to disclose any convictions that have been sealed or erased according to a court order.
Background Authorization Forms: A background check is required of all individuals involved with an application. The Commission's third-party vendor conducts background checks. The applicant must provide three permission papers and an unexpired government-issued photo identification card for each person mentioned on the application for the vendor to obtain the required information. These papers include the CORI Acknowledgement Form, the Disclosure and Acknowledgement Form, and the Release Authorization Form.
MANAGEMENT AND OPERATIONS PROFILE SECTION
This section offers a glimpse of the applicants' strategy for running the Commission's social consumption establishment. The information needed in this section demonstrates that the applicant understands the legal requirements for doing business, including the Commission's rules, and that the applicant has plans that are unique to the license type, location, and size of the establishment, and will be allowed to operate legally.
Business Information, Articles of Organization, and Bylaws: The applicant must prove that the establishment is registered to do business in the state. Acceptable proofs include:
Certificates of Good Standing: All candidates must present certifications of good standing from the State Secretary of Massachusetts, the Department of Revenue, and the Department of Unemployment Assistance. All certificates must be dated within 90 days of the date of submission of the licensing application.
Note that the applicant must have workers in order to register with the Department of Unemployment Assistance and obtain a certificate of good standing. If an applicant does not have any staff, an attestation to that effect will be accepted in place of the Department of Unemployment Assistance's certification of good standing.
Business Plan, Liability Insurance Plan, & Proposed Timeline: All applications must provide insurance plans, projected timeframes for attaining operations, and a comprehensive business plan for the establishment's operation. Revenue and cost forecasts, a business overview, and an operational plan are all examples of information that may be included in the plan.
Although insurance policies are not needed until licensing, applicants must show in their plans that they will acquire policies covering general liability and product liability for a minimum of $1 million per occurrence and $2 million in aggregate yearly once licensed. Each policy's deductible cannot exceed $5,000 per incident.
Summary of Operating Plans, Policies, and Procedures: The applicant must submit some plans, policies, and procedures related to the operating of the marijuana establishment. These documents must be precisely drafted to comply with the CCC's regulations and guidance documents. These documentations include:
Diversity Plan: Social consumption establishment license applicants must present a Diversity Plan as part of their Management and Operations Profile. Diversity plans must be developed to promote equity in the establishment's operation for people of color, especially Black, African American, Hispanic, Latinx, and Indigenous people; women, veterans, individuals with disabilities, and LGBTQ+ people.
Note that this plan is a distinct requirement separate from the Plan to Positively Impact Disproportionately Harmed People. This plan must show the goals, programs, and measurements that the marijuana establishment will pursue once provisionally licensed. All goals should be quantifiable and measurable.
Applicants seeking licensing for social consumption establishments must provide the following plans, policies, and procedures in their applications:
Upon receipt of your application, the Cannabis Control Commission will review it for compliance with its regulations. If any portion of the application is found to violate the Commission's regulations, the applicant will be sent an RFI (Request for Information). A defect or non-compliance notice will include a brief narrative describing the problem.
Any errors and non-compliance problems must be corrected before resubmitting the license application or relevant portion. The Commission will immediately review the re-submitted material. Otherwise, a second RFI notice will be issued after a supplementary examination if the application is not determined to be consistent with the Commission's rules.
An application is queued for evaluation based on the date and time it was submitted and the application type (priority, expedited, or general). Following evaluation, the applicant will be informed whether the CCC approves the application. The notice will state:
A provisional license will be recommended as long as the applicant and the relevant authorities provide the required information. For more information on the social consumption establishment licensure, download and review the CCC Adult-Use of Marijuana Regulations or contact the Cannabis Control Commission at (774) 415-0200 or Commission@CCCMass.com.
A social consumption establishment license fee costs $10,000. Before a license is granted, the applicant must also pay a license application fee of $1,500. Except where expressly permitted, payments are non-refundable and cannot be waived.
According to the Massachusetts Guide on Cannabis Licensure, no person or entity having direct or indirect control in a social consumption establishment license may be granted more than three such licenses.
For other cannabis licenses, licenses will be limited to businesses controlled by and with majority ownership by Economic Empowerment Priority Applicants or Social Equity Program Participants; microbusinesses; and craft marijuana cooperatives, for a period of 36 months from the date the first social consumption establishment receives a notice to begin operations.